Company Milestones

Founded in 1997, XLHealth has a proud history as an industry leader in improving the quality of care and reducing the cost of healthcare for chronically ill seniors through disease management services. Over the past three years, the company has evolved from an outsourced provider of disease management services to become the owner and operator of Care Improvement Plus, one of the nations largest chronic condition Special Needs Plans (C-SNP) -- disease management-focused health plans offered to Medicare beneficiaries with chronic illnesses such as diabetes and heart failure.

XLHealth (www.xlhealth.com) has been at the forefront of disease management innovations since its inception. Founded by a group of physicians and business executives, XLHealth builds upon the more customary remote telephone "call-center" or direct mail support with ongoing, face-to-face meetings with patients and physicians. XLHealth also uses tight coordination of care, behavioral modification, and in-depth patient profiling integrated with claims, pharmacy, and lab information to generate sophisticated, predictive modeling. The firm emphasizes preventing avoidable and expensive disease complications and hospitalizations.

XLHealth's success comes, in large part, as a result of its culture that emphasizes entrepreneurial drive and a willingness to take calculated business risks, as well as a management group with in-depth clinical and healthcare administrative experience.

1997:

Torrey Brown, M.D., William Cirksena, M.D., and Jeffrey L. Tredwell, D.P.M., held discussions about improving the way healthcare is delivered to chronically ill patients.

Brown had served as an assistant dean at Johns Hopkins Medical School and a vice president at Johns Hopkins Hospital; Cirksena had served as the chief of nephrology at the Walter Reed Army Institute of Research; and Tredwell had established the System of Evaluation and Treatment that led to a significant reduction of complications causing lower extremity amputations.

They subsequently presented their newly developed approach to disease management to Patrick Hervy, a successful entrepreneur who worked with them to bring their vision to reality. Paul A. Serini, Esq., joined their effort, bringing with him more than 20 years of experience in the healthcare, legal and allied consulting fields.

1998:

Diabetex, as XLHealth was originally called, is established. First contract covering PacifiCare plan members begins.

1999:

XLHealth issues its first sales of Class A Preferred Stock.

2000:

XLHealth signs first contract with Humana to offer disease management services to approximately 4,000 plan members.

2002:

XLHealth partners with Walgreens, the largest drugstore operator in the U.S., to offer participants in XLHealths disease management programs one-on-one medication consultations with pharmacists familiar with the complex issues experienced by chronically ill patients.

2003:

XLHealth is awarded a demonstration project in Texas by the Centers for Medicare & Medicaid Services (CMS). The study seeks to improve quality of care and efficiency by providing chronically ill patients with enhanced prescription drug coverage and disease management services. XLHealth successfully recruited 10,000 participants in the program.

2004:

CMS selects XLHealth to administer Tennessee's Medicare Health Support program, a major new initiative to help improve the quality of care for chronically ill beneficiaries under Medicares fee-for-service program.

XLHealth is awarded the Disease Management Association of America's Recognizing Excellence Award for "Best Disease Management Program: Medicare."

2005:

XLHealth announces the closing of a significant private placement of preferred stock and related options with GS Capital Partners 2000, L.P., a private equity fund managed by Goldman, Sachs & Co., and Norman Payson, M.D., the former chairman and chief executive officer of Oxford Health Plans. The investment represents one of the largest capital financing transactions in the growing disease management sector and marks Goldman Sachs Capital Partners entry into the field.

The Disease Management International Purchasing Consortium recognizes XLHealth for its approach to medication management by selecting the company for its Best Disease Management Ideas for 2005 award.

CMS grants XLHealth approval to market its Care Improvement Plus plan, a new special needs plan that focuses on the unique healthcare needs of chronically ill Medicare beneficiaries living in Maryland. XLHealth is one of only a few companies throughout the nation approved by CMS to provide the Medicare Advantage plan, which combines traditional Medicare coverage with disease management services, a Medicare Part D drug benefit and medication management services, for Medicare beneficiaries with diabetes, heart failure, and/or end-stage renal disease.

2006:

Care Improvement Plus launches services in eight counties in Maryland, with approximately 98,000 chronically ill beneficiaries eligible to join.

XLHealth launches the Medicare Health Support pilot program to serve approximately 20,000 invited, fee-for-service Medicare beneficiaries living with diabetes and/or heart failure in Tennessee. XLHealth is one of only eight organizations selected by CMS to operate a regional Medicare Health Support pilot program.

CMS grants XLHealth approval to broaden Care Improvement Plus coverage to include Medicare beneficiaries with chronic obstructive pulmonary disease. Care Improvement Plus also receives approval from CMS to expand its Maryland plan into three additional Maryland counties and launch in five additional states: Arkansas, Georgia, Missouri, South Carolina and Texas, making the plan available to approximately 1.3 million Medicare beneficiaries. This is the first time a chronic illness Special Needs Plan is offered to residents of Arkansas, Georgia, South Carolina and Texas.

2007:

Care Improvement Plus grows to become XLHealths core business focus, with over 70,000 chronically ill members.

XLHealth successfully completes a $290 million private placement with funding provided by MatlinPatterson Global Opportunities Partners III L.P., and MatlinPatterson Global Opportunities Partners (Cayman) III L.P., investment partnerships managed by MatlinPatterson Global Advisors LLC.

As part of the transaction, XLHealth completes its acquisition of Leprechaun, LLC, the market leader in outsourced HCC management for Medicare Advantage plans, offering technology and consulting services designed to improve efficiencies in Medicare Advantage plan member assessment, diagnosis, data management and claims management.